Wednesday, 22 July 2015


Like it or not (and I don't)this is George Osborne's time. Not the age of Osborne because it won't last but a time when he dominates the Tory Party,leaving Cameron to pick up the pieces of the promises they cant fullfil. He dominates the stage,mesmerises the press and sets elephant traps for the Labour Party which we duly lumber into.

It's quite an achievement for a lad whose policies are so wrong headed  they'd make Nigel Lawson blush. Everyone thinks its due to a supreme intelligence. In fact its the manifestation of a reptilian cunning coupled with a childish desire to play naughty tricks and a disposition to show how clever he is after being repressed for too long. 

The reality is he got a second class degree and has a second rate mind of the kind that latches on to half understood ideas  becoming obsessed by them to the exclusion of sense where a first class brain like Cameron would pick the bits that are useful, junk the rest and flit easily from one set of ideas to another without believing in any of them. 

Its this obsessiveness which makes him such a threat He sees no use for the state wants to pare it down to nothing by anorexia as an economic policy thus cutting spending  to provide tax cuts for the better off and balancing the budget by 2020. Fine in theory. Disastrous in practice because it betrays no understanding of how the economy works

Cuts deflate demand. Firms want higher and sustainable demand to invest .British capitalism is dependant on the state. Having lost out in world competition for markets it has retreated into a protected niche where its better called scrounger capitalism than competitive enterprise It leaches on the state, takes functions from it to make profits,doesn't invest but gobbles seed corn and demands heavy subsidies to keep going .Easier to do that than to make things and sell them to the world even though the supply of cut price assets from the states must eventually dry up leaving a shrinking ,manufacturing base losing more jobs and requiring ever more imports and producing an ever widening trade gap which is already the greatest in the advanced world

We've become a tax haven attractive not to overseas investment but to the rich  and to funny money and its manipulators.Once a nation becomes dependant in that way it is more and more difficult to break out and rebuild because the incomers become a powerful vested interest against change

Reducing borrowing  in a recession (which we still are) doesn't make sense .It reduces activity and demand. The only time to pay off debt  is in a strong sustainable recovery  which this isn't. Until we get that unemployment will be higher than it should be, ,government revenues less and expenditure on the dole of misery,on subsidising rents wages and benefits will be greater

That's the economics .The politics are that the strategy,while it hurts the poor and Labour against whom its directed it also alienates the people who voted for it. The tax cuts will benefit the really well off rather than them but their services and the quality of  their lives will decline,because, unlike the really rich (the background he and Cameron come from, they cant afford to insulate themselves in their own little world.Policing will be less adequate ,their kids will be priced out of everything but burdened with debt A nation of which they're proud will sink into irrelevance as a weaker economy means a weaker pound ,weaker defence , a weaker say and a growing burden of foreign debt. Governments always say Britain will punch above its weight but economic anorexia will make the weight much less.

That's the future Osborne offers you. Its difficult to shift the blame for all that onto  Labour, the unions and  scroungers. Not that that will stop our George from trying.

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